Vietnam's retail beauty, personal care market expands 30% in 2025 amid intense competition

Vietnam’s beauty and personal care segment is emerging as a key growth pillar of the country’s e-commerce market, but recent data suggests the industry is entering a more mature, selective phase.

According to a report by Metric.vn, retail sales in the category reached VND74.4 trillion ($2.83 billion) in 2025, up nearly 30% year-on-year, making it the largest segment in Vietnam’s online retail market.

In the fourth quarter of 2025, revenue hit VND15.3 trillion ($581.76 million), rising 23% both quarter-on-quarter and year-on-year. The category accounted for about 14% of total e-commerce market size over two consecutive quarters, driven by core segments such as skincare, body care, hair care, cosmetics, fragrances, and personal hygiene.

Metric quoted forecasts from Statista as stating that Vietnam’s cosmetics market could reach $3 billion by 2026, with a compound annual growth rate (CAGR) of 8.3% from 2024 to 2028, outpacing many other FMCG categories.

Data from Kantar Worldpanel Vietnam also indicates annual spending on personal care products is growing at around 12%, the fastest within the FMCG group.

Shift from volume to value

Despite strong top-line growth, the market is showing clear signs of transitioning from volume-driven to value-driven expansion.

In Q4/2025, total sales volume reached 79.3 million units, up 9% from the previous quarter but down 2% year-on-year. Meanwhile, revenue growth (+23%) outpaced volume growth by more than 2.5 times, reflecting a 13% increase in average unit price (AUP).

At the same time, the number of active sellers declined 8% quarter-on-quarter and 13% year-on-year, highlighting an ongoing market consolidation.

The trend suggests a shift from broad-based growth to deeper, efficiency-driven competition, favoring brands with stronger operations, product quality, and customer experience.

Consumer behavior is also evolving, particularly among younger demographics, the report shows.

Citing Q&Me Skincare Industry Report 2026, Metric said that 84% of users prioritize transparent ingredients, while 82% seek long-term effectiveness over short-term results. This reflects a growing preference for quality, safety, and brand trust.

Data from Metric shows that in Q4/2025, official brand stores (Shop Mall) accounted for 64.4% of total revenue, up 36% year-on-year. The average unit price for these stores reached VND235,000 ($8.94), about 1.5 times higher than non-official sellers, indicating consumers are willing to pay a premium for authenticity and reliability.

While gross merchandise value (GMV) continues to grow 23.2% industry-wide, profitability is under increasing pressure.

Platform fees on Shopee, the largest by market share, now range from 15% to 18% per successful order, including transaction and marketing support costs, Metric cited data by UpBase as saying. Meanwhile, customer acquisition costs (CAC) are rising by 25-30% annually.

Escalating advertising costs, including bidding prices and KOL/KOC partnerships, are pushing many sellers into a cycle of “buying traffic” through promotions and discounts. While tactics like flash sales can boost short-term revenue, they often erode margins and weaken brand positioning over time.

As discounted prices become the new reference point for consumers, businesses may struggle to return to standard pricing, risking a prolonged “race to the bottom.”

Looking ahead, Vietnam’s beauty e-commerce market is expected to undergo further consolidation, Metric noted. Companies that can balance cost control with brand building, customer engagement, and product differentiation are likely to gain long-term advantage.

The shift toward value-driven growth signals a more sustainable phase for the industry but also raises the bar for competition, where scale alone is no longer enough.